Handling the News
This chart show price of JSMR in weekly. The period is for two years. We saw that at beginning JSMR price reach highest, then it slide to its lowest. Before it going up again until now.
First, let’s ignore the chart type. We won’t use that to predict the future, because predictions is always as assumptions. It’s true that if we know the future then we can make better transactions. But what’s the chance of the future work favor to us? How can we make sure. But if some of you curious about the chart, just search ichimoku or glance balance. It’s a few that can said to be a good chart along with moving average.
Back to business. What we focus is the yellow box, when the price reach lower part of the chart. Every stock could be in this position. The key question is we need to know, why some will change direction and moving up again, and some keep going down. If we know at least some clue about it, maybe we can have a glimpse of the future.
Every bad news of course will knock the price down. It’s strange if that not happen. Investor are human, and human tend to avoid pain. Watching the stock we own going down is a painful experience. It’s like riding the roller coaster, many will see it scary. And news will confirm the fear we have. It’s when the stock going down, people start focusing the bad news and ignore the good news.
Last year really bad for this stock. One of the big stock that not going up along with IHSG. Holding this stock is just like invite bad news to our portofolio. From the debt that reaching the sky, the huge amount of capex JSMR need to expand, the less profit project, and the worst is about JSMR lose in court and need to pay almost one year profit to tirtobumi. What else we can face as owner of this company?
If you are holding this stock, these times really not good for health. Is it true? Or you can see it as opportunity to buy. We have 8 months chance to buy. So it’s really good opportunity for employees that can’t buy at once. We also working, so we also can’t full power in one hit. It’s just like red carpet for investor to buy this stock. We really happy if we can buy discount product at shopping mall, why not this one.
The tricky part is to guess, how bad is the news. Is it going to get better or worse. We, as the true investors, need to look foward, not look behind if want to keep growing our asset. No one can change past, but we can direct our future. As human we tend to stick to the past. We see the result and keep thinking it. This is what Peter Lynch call as Penultimate preparedness. We anticipate something that already happen and forget to look foward.
Seeing a bright side of bad thing, actually not very easy. Especially if our mind already trained to react to bad things first for our survival. It’s like writing with right hand then switch to left hand. That need training, and it’s impossible to change in 1 day. But we can make count our day with little change.
Why we need to see things in good ways? The answer is obvious. Every day, more good things happen than bad things. So direct our mind to see in the same ways will have better chances to success. Beside, even we just neutral, the management inside will work hard to solve the problems. That is what we are doing if we work, right? We work hard to get a big end year bonus, or increase of salary, or event acknowledged from our boss. If we do that, what make other different? We all are human being.
But after we analyse in all possibility, the management don’t have power or don’t want to change for better, then either we don’t need to involve or maybe if we already have this stock, we need to consider the way out strategy for us. It’s suicide if we stick to company that falling down.
We done that with AISA, SMGR and PGAS. The only company that we need to say goodbye for now. We never know if we will joining again in future. Again, who know what the future lies. That’s our decision. Not yours. We said good company, it maybe not good from other point of view. Or vice versa. That’s why people that optimistic will buy, and people that pessimistic will sell. What we do, is after we consider carefully with our wisdom, not after we hear there and here.
What if our analyse is wrong? Then we learn something. With learning, our wisdom increase and we can make better judgement in the future. Easy, right?
That’s why we write this article first time in English. Hope all of you can still understand what we mean. If not, there is Google translate to use. In information era, it’s really hopeless if we die because lack of information. It’s like thirsty and die in middle of lake.
Now, after JSMR, what next? And remember we type when the stock going down, people start focusing the bad news and ignore the good news? Now, when the stock going up, who cares about bad news. That’s when we need to be careful. It’s like Buffett said, when other greedy, we should be fearful, and be greedy when other in fear.